Groupon's third-quarter earnings report badly missed Wall Street consensus, as the daily deals segment of the business continued to struggle.

The company reported a loss of $3 million, or break even on a per-share basis, on $568.8 million in revenue. Analysts polled by Thomson Reuters were looking for earnings of 3 cents a share on $590.12 million in revenue. Revenue rose 32% year-over-year, but Wall Street was looking for more.

The daily deals business is to blame, said Stifel Nicolaus analyst Jordan Rohan, but the company's saving grace, Groupon Goods, may help pivot the company as it tries to compete more with the likes of Amazon ( AMZN) and other shopping sites. But Groupon hasn't done enough to earn investor confidence.

"Right now, investors are not likely to give Groupon the benefit of the doubt. Accounting issues aside, investor trust in the core Groupon business model and management team is insufficient to take that leap of faith," Rohan wrote in his note. He noted that the company is pivoting from a high margin company with the daily deals to a lower margin e-commerce company. Rohan has a hold rating on the stock with no price target.

In a press release, Chicago-based Groupon noted Groupon Goods is now doing $1.5 billion in global billings on an annual rate, and has done "nearly $500 million in revenues shortly after its one-year anniversary."

JPMorgan analyst Doug Anmuth is positive on the Goods segment, saying growth "...has been impressive though it's coming at the expense of local deals and Goods have a lower operating margin profile relative to local deals." He rates Groupon at neutral.

When Groupon began to really gain prominence during the recession in 2010 into 2011 prior to its initial public offering, investors were talking about this company in an extremely positive light. Google ( GOOG) reportedly bid $6 billion for the company at the height of its popularity, only to be turned down. The company's market cap was $2.56 billion at the end of trading Thursday.

The company is still generating cash, though operating cash flow decreased 35% year over year to $42.1 million. As of the end of the quarter, the company had $1.2 billion in cash and cash equivalents. Groupon may use up a significant portion of this cash, as it transitions its business model from daily deals to goods.

Credit Suisse analyst Stephen Ju echoed the thoughts of Stifel's Rohan on investor worries as Groupon pivots its business model.

"We believe investor concern will continue to ensue given the company's short-term decision to prioritize growth in the far lower margin goods business, without clarity as to when growth will return to the higher margin daily deals business," Ju wrote in his research report. He has a neutral rating on Groupon shares with a $6.50 price target.

Groupon is clearly in a state of flux as it tries to recapture some of the luster it lost after accounting problems were uncovered in late April.

Hudson Square analyst Dan Ernst downgraded shares as the aggressive push of the goods segments potentially creates problems with its merchants. He also sees the goods business causing operating risks, as well as lower margins. Ernst lowered his rating to hold yet kept his $12 price target intact.

Investors looking to bet on a successful turnaround certainly won't need a "Groupon" when buying shares. Not at these levels, and perhaps not ever.

Interested in more on Groupon? See TheStreet Ratings' report card for this stock.

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